Japan has one of the highest geriatric populations in the world and because of that they have a strong demand for medical devices. They’re one of the top markets in the world and they often purchase from the US. However, that will most likely change in the future with China’s medical device industry rising to $18.8 billion in 2016 and is estimated to reach over $24 billion in 2019. Both Japan and China often look to the western world when buying for their country’s medical purposes, but big changes are taking place that could potentially replace the US as market leader.
The top Drivers of the Medtec Industry
India, China, Brazil and Russia are expected to be the top drivers of the medical device industry for the next 50 years. The countries are all looking to develop quickly internally and become sources for the global need on medical devices. These country’s governments are focused on pushing forward the medtec industries so they can bring economic growth to the country. The more developed they become, they stronger they’ll be in the global fight for market share. For now , we’ll focus on two of the most rapidly developing countries in the medical device industry.
India – A huge growth potential for the indian medial device industry
The government is making it easier for companies within to develop their technologies by implementing new government policies and rules in the country to allow for an increased investment in healthcare. Internally, this would benefit India as this would allow for growth and make it easier for companies to try and develop themselves and grab market share. External parties, most likely the US, would like to keep a stake in the game and try to minimize any loss coming its way so they would most likely start investing in Indian companies. OEMs in the US could buy OEMs in India in order to somewhat control the rapid growth occurring in India and not lose market share if they wanted to.
The Indian medical devices industry has huge potential to grow and be among the top 5 medical devices manufacturing hubs globally. It’s in a great location as the US designs and develops a lot of the technology, but has to ship it to clients and countries that are overseas like countries all across Europe, with one of the biggest markets being Japan. If they’re able to manufacture in India, they would lessen logistics costs and hopefully increase their revenue and profit margin.
China – More resources devoted to help the Medical Device industry grow
The market is fierce in China right now with domestic companies dominating the domestic market with low to mid range items. However, with top of the line and high tech items, the domestic market still prefers to outsource and import the devices from Medtec companies like Johnson & Johnson. The country released its 13th version of its 5 year plan, where they stated they would like to further push to increase the quality of life for their elderly population – which means more spending and growth in this industry from China.
They would like to see much of the demand for high tech devices met internally and from local companies, rather than outsourcing and having to purchase from companies not based in China. Overall the country is devoting resources to help the Medical Device industry grow and we should expect large companies in that market to expand their presence over there.
More people become older
Both of these countries currently have massive populations that continue to grow and age. As these populations get older, the demand for medical devices will also grow. As the demand grows and companies within the countries develop, they will increasingly be able to take care of their own citizens. On top of that, they will become more attractive for foreign companies to invest in them, further fueling their growth. Working with foreign companies benefits both the country and the company, so there is a mutually beneficial relationship and a strong future for the market.
Several global companies from the Medical Device industry like Becton Dickinson, Roche, Emerson or Zimmer Biomet are longterm customers of iPoint and rely on our software solutions in the field of compliance, risk and sustainability. Those relationships provide us with detailed industry insights but we also keep an eye on the market trends in 2020 to develope the best software solutions possible to serve the specific needs of the Medical Device Industry, e.g. the new EU Regulation of Medical Devices – MDR.